Tax
So You’re Making Money on TikTok Now What About Tax?
By
Elias Hussen
Jul 15, 2025
Making money on TikTok? Learn what counts as income, how to register with HMRC, and what expenses UK creators can claim all explained simply and without the overwhelm.
You’re getting paid, maybe £300 from TikTok Shop, a gift card from a brand, or your first Creator Fund pay-out.
That’s exciting… until someone says, “You’ll need to pay tax on that.”
Suddenly your DMs are buzzing, your camera roll’s full of collab content, and now you’re Googling “Do I need to register with HMRC?”
You’re not in trouble. You’re just a creator who’s growing.
Here’s what you actually need to know - no lectures, no jargon, just peace of mind.
What Counts as Income?
If you’re being rewarded - in money or stuff - to post, promote, or tag… it counts as income.
Income Type | Real-Life Example |
|---|---|
TikTok Shop (affiliate) | You post a beauty product → someone buys → you earn a cut |
Sponsored posts | You get paid to mention a skincare brand |
Creator Fund | Monthly pay-out from TikTok |
Gifted items you post | You tag a brand in a video about gifted clothes or products |
Live gifts | Coins → diamonds → you withdraw £ into your bank |
If you’re thinking, “but I didn’t get cash,” remember this:
If you posted something in exchange for value it’s income.
Common Mistakes Creators Make (and How to Avoid Them)
“It’s just a gift”
If you post about it, it’s not a gift it’s payment in kind.
Keep track of what it’s worth and whether you posted. Log brand, date, and value.
“I’ll sort tax out later”
HMRC cares as soon as you earn £1,000 or more per year from TikTok or any side hustle. That’s not a lot it could be two affiliate campaigns.
Once you hit that, register at gov.uk/set-up-self-employed
“TikTok will send me a tax report”
Nope. There’s no annual breakdown. No summaries. It’s on you to track it all.
Log everything: Creator Fund, Shop commissions, affiliate pay-outs, brand payments, gifts even if it’s £15.
What You Can Claim as Expenses
You only pay tax on profit so deduct anything you use for TikTok:
Expense | Claimable? |
|---|---|
Lighting, tripod, mic | Yes |
Editing software 9CapCut, Canva Pro) | Yes |
Props, backdrops | Yes |
Phone/WiFi bills | Partially - claim the % used for content |
Outfits | Only if they're costumes or used only in content |
Tip: Save receipts digital or physical, it all helps.
How Much Tax You’ll Actually Pay
Profit Range | Tax Rate |
|---|---|
First £12,570 | 0% |
£12,570 - £50,270 | 20% |
£50,271 - £125,140 | 40% |
£125,141 + | 45% |
You’ll also pay National Insurance on profits above £6,725/year.
Tip: Set aside 25–30% of what you make. That covers Income Tax, NI, and leaves a buffer.
What If You’re Starting to Earn Serious Money?
If you’re making £2,500+ a month, you’ve got more to think about not just tax, but how to keep more of your income.
That’s when creators start to:
Work with an accountant
Explore if a limited company makes sense
Set up proper systems for income/expense tracking
Not sure what your next move is? Book a quick call we’ll look at your numbers together.
Your TikTok Creator Tax Checklist
Here’s what you actually need to do - no fluff:
Earning £1,000+/year? Register as self-employed
Track all income (yes, even that £50 gift you posted)
Log expenses (software, gear, etc.)
Save 25–30% of income for tax
File a Self-Assessment by 31 Jan every year
Book a discovery call if you want help (or just peace of mind)
Final Thoughts
If you’re getting paid on TikTok, that’s a big deal but it comes with new responsibilities.
The good news? You don’t need to figure it out alone. The moment you treat your content like a business is the moment things get easier and more profitable.
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